# Morpho Optimizers Expenses Methodology

## 1. Overview

Expenses is defined as the total cost incurred by Morpho Optimizers to operate its business, specifically focusing on token incentives distributed to users. These expenses are represented by the value of assets distributed to supply-side and demand-side participants to bootstrap liquidity and incentivize protocol usage. For Morpho Optimizers, these costs are comprised of legacy and current token incentives distributed either directly via rewards contracts or through external distribution partners such as Merkl.

## 2. Data sources

- **Blockchain events**: `Claimed` events from `UniversalRewardsDistributor` contracts and ERC-20 token transfers from the Morpho rewards multisig address to the Merkl Angle Distributor contract, covering Ethereum and Base
- **External data**: End-of-day price feeds and asset metadata

## 3. Step-by-step calculation

### Component A: Legacy and market rewards tracking

- **Purpose**: Capture legacy token incentives and market rewards distributed directly to users
- **Logic**: `Claimed` events from `UniversalRewardsDistributor` contracts are parsed. The reward asset address and the distributed amount are extracted from each event.
- **Key fields**: `token_address`, `amount`

### Component B: Merkl and current rewards tracking

- **Purpose**: Capture current token incentives distributed through Merkl
- **Logic**: ERC-20 token transfers from the Morpho rewards multisig address to the Merkl Angle Distributor contract are identified. The transferred asset address and the transfer value are extracted to represent active incentive distributions.
- **Key fields**: `token_address`, `amount`

### Component C: USD conversion and normalization

- **Purpose**: Normalize incentive amounts and convert them to USD
- **Logic**: The extracted incentive amounts are normalized by decimal precision using asset metadata. The normalized amounts are then multiplied by end-of-day asset prices to determine the USD value of the expenses.
- **Key fields**: `amount`, `price_usd`

### Component D: Final aggregation

- **Purpose**: Aggregate daily expenses and apply zero-filling
- **Logic**: The USD-denominated token incentives from both legacy and current distribution mechanisms are aggregated by day, chain, and product. A zero-filling strategy is applied to ensure continuous daily data coverage without gaps.
- **Key fields**: `expenses`

*This methodology was automatically generated by Token Terminal's methodology analyzer.*

Total project operating and incentive expenses.

Expenses

Lending

Lenders can earn on Morpho using Morpho Vaults, noncustodial simple to use lending vaults that optimize yields for depositors. Borrowers can borrow any assets directly from Morpho Markets. Developers and businesses can use different parts of Morpho’s permissionless infrastructure to build any custom use case or application.

Morpho is an open, efficient, and resilient platform that allows anyone to earn yield and borrow assets. At the same time, developers or businesses can create markets, curate vaults, and build a range of applications on its flexible, immutable infrastructure.

MORPHO tokenholders own and govern the protocol. They currently do not take a cut of the interest and third-party token incentives earned by lenders (revenue). Morpho's investors include a16z, Coinbase Ventures, Semantic Ventures, etc.

Morpho Optimizers

Expenses

Expenses

Chain breakdown